We are enormously shocked and saddened to learn of Friday’s assassination in Moscow of Russian opposition leader Boris Nemtsov. In 2011, Mr Nemtsov took part in our 20th anniversary celebrations when he joined a panel discussion at the Forum 2000 Annual Conference co-hosted by CERGE-EI to consider the issues facing legal institutions in transition countries. We would like to pay tribute to this staunch and fearless opponent of corruption. His violent and premature death is a huge loss to all supporters of democracy.
The following post was written by CERGE-EI PhD Student Lasha Lanchava, originally appearing on the ISET Economist blog.
In October 2007, responding to the problem of very low birthrates in the country, Ilia II. of Georgia, the Catholicos-Patriarch of All Georgia, announced that he would personally baptize any third and subsequent child born to Orthodox families from that time onwards. This promise seems to have had a considerable impact on the reproduction behavior of Georgians. According to the National Statistics Office of Georgia (NSOG), the number of births increased from about 49,000 in 2007 to about 57,000 in 2008 and 63,000 in 2009. This is a remarkable 28% increase in two years’ time, while the number of births from 2000 to 2007 had been fluctuating between 46000 and 49000. At the end of 2008, the Patriarch for the first time baptized thousands of babies at the Sameba Cathedral, and the tradition continues until today.
In March 2009, the BBC brought the enthusiastic headline: “Church leader sparks Georgian baby boom”. The article states that “two years after having one of the lowest birth rates in the world, Georgia is enjoying something of a baby boom, following an intervention from the country’s most senior cleric”. The results are, in the words of the Georgian Orthodox Church, “a miracle”. A report with a similar message was published by CNN on April 2010 in which the Patriarch himself claims credit for the surge in births: “I have already baptized about 5,000 children. […] Parents decided to give birth to these children because they had a chance to be the Patriarch’s godchildren.”
The BBC also interviewed the head of Georgia’s civil registry, Giorgi Vashadze. More profanely, he attributed the increased birth rates to accelerated economic growth and increased employment in the years after the Rose Revolution: “Who is now creating families? People who five years ago were out of work,” he said. “Previously, they had no income. They could not get married. Today they are working. They have salaries… So I think this is a major factor.” According to the NSOG, Georgia did indeed experience a remarkable growth in real GDP by about 10 % in 2006 and 2007, going down in 2008 due to war with Russia but still remaining significantly higher than in the previous years.
According to the Caucasus Research Resource Center (CRRC), 94% of the Georgians consider the Patriarch to be the most trustworthy man in the society, and likewise, the church is the most trusted institution in Georgia. Therefore, the opinion of Georgian public can be easily swayed in favor of the church. But is the Patriarch really responsible for the stunning increase of the birth rate in Georgia? Using the toolbox of quantitative economic analysis, I wanted to find out…
A NATURAL EXPERIMENT
Religion as an important driver of socio-economic developments can be traced back to Max Weber’s famous 1905 book The Protestant Ethic and the Spirit of Capitalism, relating the differences in per-capita GDP in Europe to the respective shares of Protestants and Catholics in those countries. Ever since, a huge body of literature has elicited connections between religious beliefs and economic behavior. For example, McCleary and Barro (2003) show that countries with high levels of religious observance (operationalized as attendance at religious services) tend to experience lower GDP growth. Crabtree (2010) explores the link between the share of religious population of a country and its and per-capita incomes. Lipford, McCormick, and Tollison (1993) look at the connection between the rates of church membership and crime and various demographic numbers like divorce, marriage, and fertility.
In our setting, the announcement of the Catholicos-Patriarch’s initiative yields what economists call a “natural experiment”. In the laboratory, it is possible to define a treatment group and a control group, yet many economic questions which are about the society as a whole cannot be answered in the lab. A natural experiment is a situation where for natural reasons there is something like a treatment and something like a control group. In the problem at hand, the majority of Orthodox Christians (OCs), making up 84% of the population, can be considered a treatment group, as they are the only ones to whom the Patriarch’s initiative appeals. The Non-Orthodox Christian (NOC) ethnic minorities, such as Armenians, Azerbaijanis, and other congregations can be considered as a control group, if we assume that the Patriarch’s announcement will not affect their reproduction behavior. The majority of NOC population consists of Armenians and Azerbaijanis who comprise about 15 % share of the total population of Georgia. Armenians are members of the Armenian Apostolic Church and Azerbaijanis are Shiite Muslims. The figure shows the composition of Georgian population by religious belief – the brighter the color, the higher the share of NOC population (except for the occupied territories, which are not included in the analysis).
Using a methodology called difference-in-differences (DID), we can identify whether the religious leader’s initiative had causal impact on the birth rates in Georgia.
Dear friends, colleagues and supporters of CERGE-EI,
As 2014 comes to an end, I would like to once again thank you all for your generous support of CERGE- EI’s research and educational mission. I would also like to take this opportunity to summarize what we have achieved together this year:
- We have further improved our position in global research rankings. Research papers in Economics (RePEc) ranks CERGE-EI in the top 5% of economic departments and research institutions, and the Social Science Research Network ranks us in the top 2%.
- CERGE-EI faculty and researchers published 32 articles in ISI impact-ranked journals including American Economic Journal: Macroeconomics, American Economic Journal: Microeconomics, The Economic Journal, and Review of Finance. It is a special pleasure to announce that Filip Matějka has a forthcoming article in the American Economic Review.
- Our community was honored to witness Prof. Orley Ashenfelter, former President of the American Economic Association and editor of the American Economic Review, former member of the CERGE-EI Executive and Supervisory Committee, and current member of the CERGE-EI Foundation Board of Directors, awarded an honorary doctorate from Charles University.
- Selecting from other academic achievements, Jakub Steiner and Štěpán Jurajda were appointed docent (Associate Professor) and Professor by Charles University, respectively. Patrick Gaulé has been awarded the Otto Wichterle Award, an honor given by the Czech Academy of Sciences to stimulate and encourage exceptionally promising young scientists.
- Students from 15 countries started their studies in our PhD program (26 students) and Masters in Applied Economics program (21 students), coming from countries as diverse as Croatia, India, Ivory Coast, and Lithuania. CERGE-EI awarded 10 PhDs and 21 MAs in our flagship PhD in Economics program, and 15 MAs in our Masters in Applied Economics program.
- We are proud to announce that, as last year, CERGE-EI PhD students have again dominated the Young Economist of the Year competition organized by the Czech Economic Society. First place went to Vojtěch Bartoš, second to Olga Popova, and third to Klára Kalíšková.
CERGE-EI and Nadace CERGE-EI invite current university students and recent graduates to submit papers to the New Economic Talent 2015 competition. NET 2015 is under the auspices of the US Embassy in Prague.
The competition is open to current Bachelor’s and Master’s students (full-time or part-time) or Bachelor’s and Master’s graduates (up to two years after graduation) in any field, who are interested in contemporary economic issues and wish to better understand the forces and processes that ‘shape the world’.
We are proud to announce that CERGE-EI doctoral students have taken all three top prizes in this year’s Young Economist of the Year competition of the Czech Economic Society.
Vojtěch Bartoš took the first place for his paper “Sharing Norms during Seasonal Food Shortages: Experimental Evidence from Afghanistan.” Olga Popova came second with “Can Religion Insure against Aggregate Shocks to Happiness? The Case of Transition Countries.” The third prize went to Klára Kalíšková for her paper “Labor Supply Consequences of Family Taxation: Evidence from the Czech Republic.”
The annual competition, which is organized by the Czech Economic Society, seeks to identify and award the most talented young students of economics.
CERGE-EI recently participated in the ‘Week of Science’ (Tyden vědy) of the Academy of Sciences. The Week of Science is the most extensive scientific festival in the Czech Republic with over 500 events and activities across the whole country.
CERGE-EI participated in the festival by inviting young Czech students to take part in an economic experiment. The experiment allowed the students to experience the scientific research being done on human decision-making.
While in the CERGE-EI computer lab, the students took tests of short-term memory and learned basic information about the significance of short-term memory for everyday life and human intelligence.
The second part of the experiment was devoted directly to human decision making, with the students solving concrete logical problems. Subsequently they were presented with the correct solution to the problem and learned about the decision making steps required to reach the answer.
The students also got familiar with the concept of the “Keynesian beauty contest,” which illustrates the difference between valuation on the basis of personal preferences and on the basis of perceived popularity in society. The aim of the experiments was to help the pupils understand how experimental economic research is done while also learning the basic role of human decision-making in economic theories and everyday life.
Education in economics is one of the least reformed areas in the post-communist world. University classrooms across the former Soviet bloc severely lack motivated and professional economic instructors. Poor instruction engenders future thinkers, voters, and leaders with distorted or no understanding of modern economic principles. Young people are robbed of a quality education that can aid them in thinking critically about the problems facing their societies. This subsequently impedes the prospects for greater openness, growth, and prosperity in this important part of the world.
CERGE-EI Teaching Fellowship Program supports dedicated young men and women who enter undergraduate classrooms across the region to teach modern, market-based economics to the next generation. Teaching with novel methods and modern textbooks, fellows introduce new ways of thinking. Beyond their strong impact in the classroom, the fellows demonstrate best practices to other faculty members, raising quality throughout their host institutions.
Tomáš Miklánek, a CERGE-EI PhD Student from Slovakia, wanted to make a contribution to the future prosperity of the region and decided to join the Teaching Fellows Program to teach a course. Teaching in the classroom is never an easy thing, but Tomáš had his mind set on an even bigger challenge. Rather than teach in his native Slovakia (or in the Czech Republic, a close cultural and linguistic cousin), Tomáš decided to teach in Voronezh, Russia, a remote city in Southwestern Russia.
Why did he choose Voronezh? What experiences and impact did he have there? Watch the brief video interview with Tomáš to learn more!
Corruption undermines democratic institutions, slows economic development and contributes to governmental instability. An endemic problem across the developed and developing world, corruption poses a major challenge to policy makers and governments worried about maintaining legitimacy.
So how do we fight corruption? The answer is far from clear. As David Ondracka notes, you close one hole only to discover that two new ones have opened.
That’s why on Thursday, November 21st, leaders of government, civil society, and the private sector came together at CERGE-EI to discuss innovative anti-corruption solutions and lessons learned.
See the speakers and watch the full event (including lecture slides) in the link below!:
In his new book, ‘Economic Elites, Crises, and Democracy,’ Andrés Solimano thoughtfully examines the main challenges to global capitalism, including the rise of economic elites, the increased frequency of financial crises, and rising public discontent with the status-quo.
During his CERGE-EI visit on November 19th, Professor Solimano presented data showing the rise of rich economic elites and the fragmentation of the middle class. He warned that these trends, combined with the weakening of the traditional working class and marginalization of labor, are a common feature of capitalist societies all over the world and together constitute a major threat to the stability of the system.
He also noted that financial crises have increased markedly since the 1980s, and have recently reached the ‘core’ economies of the world system. All this has led to fractionalization and public disenchantment with democracy, which manifests in social protests and the rise of extreme politics.
Solimano forcefully argued that these trends threaten to undermine the global capitalist system unless new approaches are adopted in order to solve the world’s acute social problems. He briefly discussed potential approaches, including redistributional tax policies, reclaiming and redefining public ownership, and giving labor and the middle class more voice in austerity programs.
Given the brief time available, Professor Salimano could not go into great detail about such an ambitious topic. Lucky for us, the detailed information can be found in his book, which is available for purchase here!
Over the course of his long career, George Psacharopoulos has made a deep impact on the way education is viewed from the perspective of economics. During his CERGE-EI Public Lecture on November 4th, Prof Psacharopoulos gave an interesting overview of the evolution of this research. He walked the audience through years of evolving theories and empirical evidence on the importance of education as both a personal and public investment, sharing a number of revealing facts and thoughtful insights.
See the full lecture with accompanying slides here: